There are many different blockchains and cryptocurrencies in existence today that vary significantly in how they are implemented. If you are new to blockchain technology or interested in learning about it, Bitcoin is the best place to start because it forms the foundation for all of the current innovations.

In this unit we’ll cover:

• What is blockchain technology?
• How is information manipulated and stored on a blockchain?

Note: On the Security+ exam, you won’t need an in-depth knowledge of blockchain technologies. A broad understanding of what it is and how it works will be enough to do well if you encounter questions related to blockchain ledgers on the certification exam. In this unit, we’ll delve much more deeply into the topic than is strictly necessary for the Sec+ Exam.

What is blockchain technology?

• Picture a spreadsheet duplicated thousands of times across a network of computers. Then imagine that this network is designed to update this spreadsheet regularly, and you have a basic understanding of the blockchain.
• At a fundamental level, it is that simple.
  • A blockchain is a spreadsheet where the pages can be considered blocks.
  • Once information is added to this spreadsheet, it can not be changed or altered.
  • Everyone who runs a client designed to participate in a blockchain has a complete copy of this spreadsheet.
  • Whenever a new row is added, people around the planet add the change to their spreadsheet and ‘confirm’ that the change has been made and should be added to any other network nodes they are connected to.
  • Blockchain is a distributed network of spreadsheets where everyone can stay in sync constantly. Anyone who wants to can host a complete and up-to-date copy.
  • In other words, the Bitcoin blockchain doesn’t exist in any one place. It is a synchronized document of which thousands of people have an up-to-date copy.

What’s in this spreadsheet that everyone has a copy of?

• In the case of Bitcoin, the spreadsheet contains ‘transactions.’
  • (Medical Records or other robust information types can also be stored in an encrypted format using blockchain technology.)
• We’ll discuss Bitcoin mining a bit later, but it’s safe to assume that if you are reading this document, you’ve hopefully heard the term ‘Bitcoin mining’ before.
  • Each time a new block is ‘mined’, a new ‘block’ (or spreadsheet page) is created. The first row of the new block generated contains a single transaction, a payout to the Bitcoin address that successfully mined the previous block.
  • When the Bitcoin blockchain was first started, and only one block had been mined, a single transaction was created: a 50 BTC (Bitcoin) payout to the wallet address that successfully mined the first block.

Blockchain explorers allow us to view these blocks easily. The first block, the ‘Genesis’ block, can be found here. (Open that up)

Some key concepts have been highlighted from Bitcoin Block 1, as seen above:

• The payout was 50 BTC (Valued today at 1.5 million dollars)
• The wallet address to which the payment was made, along with the date the block was mined, is also visible here.
• We can see that this block contains a single row, or transaction, which is the block reward payout.

Wallet addresses can be generated at any time by anyone.

• The wallet address we see above is public, which can be considered a public key.
• The individual who owns that address has a secret private key known only to that individual.